Final answer:
The usual starting point for budgeting is the revenues budget. It allows for forecasting anticipated income and sets the stage for allocating funds and managing expenditures. This informs the calculation of the budget deficit or surplus and helps in adjusting plans due to policy decisions or unforeseen events.
Step-by-step explanation:
The usual starting point for budgeting is A) The revenues budget. This critical component of the budgeting process involves forecasting the amount of income that will be generated, typically through taxes and other revenue sources over a fiscal year, which starts on October 1 and ends on September 30 of the following year. The revenues budget sets the foundation for determining how funds will be allocated and is essential for managing both the expense side of the budget and assessing the annual budget deficit or surplus, which is the difference between tax revenue and government spending.
All levels of government-federal, state, and local-create their budgets to show anticipated revenue and planned expenditures. These budgets can undergo significant changes due to policy decisions or unexpected events that impact prior tax and spending plans. Thus, starting with the revenues budget allows for a clear understanding of the available financial resources that dictate subsequent budgeting decisions for various departments and initiatives.